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White v. Sargent

June 2, 2005


Appeals from the Superior Court of the District of Columbia. (TR-30-01). (Hon. José M. López, Trial Judge).

The opinion of the court was delivered by: Terry, Associate Judge

Argued May 3, 2005

Before TERRY, REID, and WASHINGTON, Associate Judges.

In these consolidated appeals, appellants Eva White and Evelyn Parchment challenge the trial court's decision to grant summary judgment in favor of appellee Lucy Sargent. The trial court held that the trust created by her late husband, Ernest Sargent, was null and void because it was created for the fraudulent purpose of concealing assets and because it resulted in an improper circumvention of Mrs. Sargent's marital rights. We agree with the trial court's ruling and the reasons behind it, and accordingly we affirm the judgment.


Ernest and Lucy Sargent married each other twice, first in June of 1991 and again in December of 1995. The couple had two children together: Mary, who was born shortly after the dissolution of the first marriage, and Angelique, who was born during the second marriage.*fn1 In June 1992 Mr. Sargent filed for divorce, after Mrs. Sargent sued for a civil protection order; a final decree of divorce was entered soon thereafter. Because of the short duration of the marriage and the court's finding that Mrs. Sargent was able to work, the court denied Mrs. Sargent's request for permanent alimony, but ordered Mr. Sargent to pay child support for Mary.*fn2 One issue during that proceeding was the net value of Mr. Sargent's assets. He denied ownership of certain bank accounts and certificates of deposit, with a total value of approximately $460,000, instead claiming that he merely had power of attorney over them. The court found as a fact, however, that Mr. Sargent owned those funds, that he had "deliberately divested himself of those assets on paper," and that his testimony regarding the assets was "neither credible nor supported by the record evidence."

The Sargents remarried on December 12, 1995, and had a second child, Angelique, approximately nine months later. During the course of that marriage, Mr. Sargent insisted that Mrs. Sargent stay home and care for Mary and Angelique. The couple separated in early November of 1997. This time, it was Mrs. Sargent who filed for divorce in May of 1998, and in that action she requested both child support and alimony. At issue again was the amount of assets held by Mr. Sargent, who testified in July of 1998 that he had a negative net worth and did not own or have an interest in any substantial financial assets. Nevertheless, in an October 1998 support order, a Magistrate Judge of the Superior Court found that Mr. Sargent had "significant assets from which he earn[ed] additional income above the amount he [had] reported to the Court."*fn3 Mr. Sargent's monthly child support obligation was thus increased.*fn4

During the pendency of the 1998 child support proceedings, Mr. Sargent created the Martha Baker Family Trust ("the trust") on August 4, 1998. The corpus of the trust consisted mainly of annuities. The original beneficiaries of those annuities had been Mr. Sargent's young daughters, Mary and Angelique. Upon creation of the trust, however, Mr. Sargent re-designated the trust itself as the sole beneficiary of the annuities. The declaration of trust named Eva White and Evelyn Parchment as trustees.*fn5 Its "primary purpose" was "to provide for the education and health care of [Mary and Angelique]," as well as to "allow [Mr. Sargent] to live in the community for as long as possible and to ensure maximum level medical . . . care for [him] during [his] lifetime . . . ." In addition, the declaration of trust directed the trustees, upon Mr. Sargent's death, to rename the trust the "Ernest E. Sargent Trust."*fn6 Mr. Sargent retained the power to obtain, from the trustees, as much of the income and principal as he desired during his lifetime. He also retained the power to amend the trust and change the trustees.

Mr. Sargent died on January 30, 2001. At the time of his death, he and Mrs. Sargent were still legally married, since the divorce proceeding was still pending.*fn7 Mrs. Sargent filed this suit for declaratory and equitable relief in November 2001, alleging that the trust agreement "constituted an improper attempt to evade and circumvent [her] marital rights and should be rescinded and/or reformed." She stated in her complaint that, "[u]nless set aside, the effect of the purported transfer is to deprive [her] of her statutorily protected interest in the decedent's property and leave [her] without any means of support." The trustees filed a counter-complaint for declaratory relief on the ground that "the assets of the Martha Baker Family Trust are not part of the estate of Ernest E. Sargent" because they were Mr. Sargent's "sole and separate property." Thus, they claimed, Mrs. Sargent had "no rights or interests in the assets."

After the close of discovery, Mrs. Sargent filed a motion for summary judgment, asserting that the trust was invalid. The trustees opposed the motion; in addition, Ms. White filed a cross-motion for summary judgment. In a fifteen-page order filed on August 7, 2003, the trial court granted Mrs. Sargent's motion for summary judgment. It declared the trust null and void because it had been established to conceal Mr. Sargent's assets and to circumvent Mrs. Sargent's marital rights. The court therefore ruled that "the trust monies become part of Mr. Sargent's estate and Mrs. Sargent can claim her elective share . . . ."*fn8 These appeals followed.


Appellant White's primary claim on appeal is that the trial court erred in granting summary judgment in favor of Mrs. Sargent. She also contends that the court abused its discretion in assigning the trust assets to Mr. Sargent's estate after it declared the trust void.

Appellant Parchment makes essentially the same arguments. Ms. Parchment, however, failed to note an appeal from the order of August 7, 2003, granting summary judgment. Instead, after Ms. White noted her appeal, Ms. Parchment filed a motion in the trial court for reconsideration of its order, citing only "Super. Ct. Civ. Rule 59 and 60."*fn9 This motion was denied on November 26, 2003, but Ms. Parchment did not note an appeal from that denial. Later, on April 2, 2004, Ms. Parchment requested re-entry of the order denying reconsideration, alleging that she had never been served with a copy of the November order. The trial court, in an order entered on April 7, 2004, concluded that the November 26 order "was never docketed," and thus, "for the purpose of clarification," it denied (once again) Ms. Parchment's original motion for reconsideration. Ms. Parchment filed a timely notice of appeal from that denial.

Under this court's rules, the timely filing of a Rule 59 (e) motion (and Ms. Parchment's motion appears to have been timely) tolls the time for filing a notice of appeal from the original judgment, so that the time for noting such an appeal begins to run again from the entry of the order disposing of the Rule 59 (e) motion. See D.C. Ct. App. Rule 4 (a)(iii). This means that Ms. Parchment's appeal encompasses not only the denial of the ...

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